Financial Planning for Special Needs Parents 101, Part II

disability children

Today we will continue with our two-part blog on basic financial planning for parents of special needs children, which is part of a larger series meant to serve as a basic introduction to estate planning for special needs parents.

In our last blog we introduced you to common terms and concepts associated with special needs financial planning.

Today, we will cover a wide range of frequently asked questions that many special needs parents have about how to raise and provide for the needs of their disabled children. Please keep in mind that this blog does not constitute legal advice for your specific situation. Everyone’s circumstances are unique, and it is important that you consult with an experienced special needs estate planning attorney like Christine Matus who can help you figure out what steps you need to take to properly plan and prepare for the care and comfort of your child.

Are there special financial planning considerations if I have two children: one who’s not developmentally impaired and one who is?

Every family’s situation will be unique, but having a non-disabled child who will grow up to be entirely independent could result in some variations with regard to how you financially plan for the long-term care needs of your special needs child. It can impact how you structure your will and inheritances, and your non-disabled child may even also serve as a contributing source of income and care for your adult special needs child.

If I have more than one special needs child, do I need to set up separate special needs trusts for each of them?

Having more than one special needs child likely means you will be stretched even more thinly with regard to your finances, which means preserving your child’s access to government benefits like Medicaid through the use of tools like special needs trusts will be exponentially more important. It is possible to structure a single trust with multiple beneficiaries, but the decision about whether to create individual special needs trusts for you children will depend on your specific circumstances and their needs. If the needs of your two special needs children are entirely different from one another, it may be more advantageous to set up two separate trusts.

How can I be a positive advocate for my child in the medical system?

The best way to be a positive advocate for your child in the medical system is to ask as many questions as possible, be extremely organized, and be persistent. You should always try to write down and keep records of what you are told and what you learn at medical visits. Write down names and numbers of potentially useful contacts. You will be overwhelmed by information if you try to keep it all in your head.

How can I continue to make legal decisions and care for my special needs child when he/she turns 18?

Despite the special needs of your child, you will not be able to continue making important legal decisions for him or her with regard to things like medical care and finances once they turn 18 unless you take steps to establish a guardianship.

What’s the difference between Medicaid and Medicare?

Medicaid and Medicare are both government sponsored healthcare programs that provide financial assistance for things like medical care. Both are available to people with disabilities. The biggest difference between the two is the eligibility requirements. Medicaid eligibility is based on income and assets, and is geared towards those with little to no income. Medicare, on the other hand, is open to certain qualifying groups. It is geared towards and mostly used by seniors over the age of 65, but some people under the age of 65 can still qualify for Medicare, such as those with disabilities. These programs also differ in how they are administered and the types of medical benefits they provide.

What happens to remaining funds in a special needs trust if the disabled beneficiary dies before they are depleted?

The special needs trust will allow you to specify what happens to remainder funds if the primary beneficiary is no longer able to collect them. You can name successor beneficiaries to which the funds will be distributed if the primary beneficiary passes away.

What’s the difference between SSI and SSDI?

SSI is Supplemental Security Income and SSDI is Social Security Disability Insurance. While both programs are administered by the Social Security Administration, they provide very different benefits. SSI provides a monthly stipend to disabled individuals with very low income and assets available to them. SSDI does not have any limits on assets or income, but it is generally reserved for someone who worked and paid into Social Security for at least 10 years before becoming disabled, or it can be based on the parents work and contributions to Social Security if the potential beneficiary of SSDI is a child who became disabled before the age of 22.

Obviously, this is just a brief sampling of potential questions regarding financial planning for special needs children. We understand that, as a parent of a special needs child, you will likely have many more questions, and we hope that you will reach out to us with any questions which we have not answered in this blog.

Be sure to check out Part I of this blog to learn some of the most important terms and concepts relating to financial planning for special needs children. And keep an eye out for our next blog where we will address some of the diverse life challenges—emotional, logistical, career-related, etc—involved in raising a special needs child.

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Christine Matus

Christine Matus